Unfortunately that a Lightwater residential lease is a deteriorating asset. The lease value reduces in proportion to its lease length. The extent of this is taken for granted in the first few years due to the loss of value being disguised by increases in the Lightwater property prices.Once your lease gets to 85ish years, you should start considering a lease extension. If lease term falls under 80 years, you will end up paying 50% of the property's 'marriage value' in addition to the usual cost of the lease extension to the landlord. Marriage value is the amount of extra value that a lease extension will add the property Most flat owners in Lightwater will be able to extend under the legislation; however a lawyer should be able to confirm if you qualify for an extension. In some cases you may not qualify. There are also strict timetables and procedures to be adhered to once the process has commenced and you will need to be guided by your conveyancer from beginning to end of the process.
Leasehold residencies in Lightwater with over one hundred years outstanding on the lease are often referred to as ‘virtual freehold’. This is where the lease value the same as a freehold interest in your premises. In such situations there is often little upside in purchasing the reversionary interest unless savings on ground rent and service charges justify it.
| Lender | Requirement |
|---|---|
| Accord Mortgages | 85 years from the date of completion of the mortgage. Please ensure that you explain the implications of a short term lease to the borrower. |
| Barclays plc | Leases with less than 70 years at the commencement of the mortgage should be declined (see exception below). Leases with greater than 70 years but fewer than 85 years remaining must be referred to issuing office. Leases with fewer than 70 years should only be referred to the issuing office where the following scenario applies, as discretion may be applied subject to bank approval: • Property is located in any of the following prestigious developments: Cadogan, Crown, Grosvenor, Howard de Walden, Portman or Wellcome Trust Estates in Central London AND • The value of the property subject to the short remaining term is £500,000 or more AND • The loan to value does not exceed 90% for purchases, 90% like for like re-mortgages, 80% for re-mortgages with any element of capital raising and 80% for existing Barclays mortgage borrowers applying for additional borrowing; |
| Birmingham Midshires | Minimum 70 years from the date of the mortgage. |
| Halifax | Minimum 70 years from the date of the mortgage. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a landlord in Lightwater,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their in-depth market knowledge and the close ties they enjoy with Lightwater valuers.
Two years ago Muhammad, came precariously close to the 80-year mark with the lease on his garden apartment in Lightwater. In buying his flat 18 years previously, the lease term was of minimal relevance. Thankfully, he became aware that he would soon be paying an inflated amount for a lease extension. Muhammad extended the lease just under the wire in June. Muhammad and the freeholder eventually agreed on a premium of £6,000 . If the lease had slipped lower than eighty years, the sum would have become more costly by at least £1,125.
In 2009 we were approached by Mrs Alexandra Walker who, having was assigned a lease of a ground floor flat in Lightwater in August 2001. We are asked if we could estimate the price could be for a 90 year extension to my lease. Comparative premises in Lightwater with a long lease were worth £257,800. The average amount of ground rent was £65 billed per annum. The lease finished in 2090. Having 65 years remaining we calculated the premium to the freeholder for the lease extension to be within £18,100 and £20,800 exclusive of legals.
Last Summer we were phoned by Mr and Mrs. B Cox , who acquired a one bedroom apartment in Lightwater in April 1995. We are asked if we could shed any light on how much (roughly) compensation to the landlord could be to extend the lease by a further 90 years. Comparative homes in Lightwater with a long lease were worth £191,400. The average ground rent payable was £55 billed monthly. The lease concluded on 15 July 2079. Given that there were 54 years left we calculated the premium to the freeholder to extend the lease to be within £34,200 and £39,600 plus professional charges.